A right conundrum, input please

getmore4less

ok missed that.

£135k, 25%, £33.75k offer is £28125 so a 16.7% discount £5625.

Whats the value trend on the local market for your property type.

lets say you can get 3% on savings in 8 year thats £35750.
(mortgage gives a better return)

house value in 8 years is more than £143k you lose out.

Using the mortgage
£100k @ 3.79% paying 560pm owe in 8 years £72,668.40
pay off 28125
£71875 @ 3.79% paying £560pm owe in 8 years £34,600.14

So around £38k, house value £152k about a 12.6% rise over 8 years or about 1.5% compound

Worth looking to improve the deal.

IMHO it's not that bad as it is.

getmore4less

One thing you have to consider isthat if you use the money to pay down the mortgage.

When it comes time to pay off the debt you will either have to have saved up again and/or remortgage to release equity.

LTV should not be a problem but a change in cicumstances could make a remortgage an issue, one risk to factor in.